Falling prices, less fixed-line subscribers ? BBJ Telecom Conference

Monday, August 29, 2005, 00:00

2004 was the first year when telecommunication fees dropped significantly in Hungary. There was a considerable difference the telecom price index and the general consumer price index, Ferenc Bánhidi, board member of the National Telecom Authority (NHH), said at the BBJ?s Fixed-line Communication conference. Although the decrease in the number of fixed-line subscriptions stopped in 2004, it continued again in 2005, with some 60,000 subscribers canceling their subscription, he added.
This means that there a certain supplanting effect undoubtedly exists between fixed-line and mobile telephony, which naturally has a beneficial effect on consumer prices.
The average mobile and fixed-line fee has become nearly identical by 2004, as opposed to the initial difference of about 100% in favor of the former. The current price difference only is Ft 30-Ft 40 per minute.
According to the NHH, supplanting will never become complete, as it is limited by differences in the way the two telephonies are used. The authority?s market research found that 80% of households were still unwilling to cancel their fixed-line subscriptions.

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